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Forex - USD/CAD rises to 3-week highs on Yellen news

Published 10/09/2013, 09:39 AM
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Investing.com - The U.S. dollar eased up to three-week highs against the Canadian dollar on Wednesday, following news that Janet Yellen is to be nominated to run the Federal Reserve.

USD/CAD hit 1.0386 during early U.S. trade, the highest since September 9; the pair subsequently consolidated at 1.0379, easing up 0.10%.

The pair was likely to find support at 1.0325 and resistance at 1.0417, the high of September 9.

The White House said President Barack Obama was to announce his nomination of Federal Reserve Vice Chairwoman Janet Yellen to head the U.S. central bank later Wednesday.

Ms. Yellen’s nomination fuelled expectations Fed policy could remain accommodative for some time. If Ms. Yellen’s nomination is confirmed by the Senate, she will succeed Chairman Ben Bernanke, whose term ends January 31.

But investors remained cautious as a partial U.S. government shutdown dragged on into a second week, with few signs of progress towards a resolution ahead of an October 17 deadline to avoid a U.S. sovereign default.

President Obama repeated Tuesday that he will only enter negotiations with congressional Republicans after the government is reopened and the U.S. debt ceiling is raised without conditions.

The loonie, as the Canadian dollar is also known, was higher against the euro, with EUR/CAD down 0.42% to 1.4015.

In the euro zone, data released on Wednesday showed that German industrial production rose 1.4% in August, above expectations for a 1% gains and was 0.3% higher on a year-over-year basis.

Investors were awaiting the release of minutes from the Fed’s September meeting later in the trading day, after the bank surprised markets with a decision to keep its stimulus program on track.



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